A few decades ago, who could have thought that shopping for homeowners insurance could become so easy? Gone are the days when one had to spend hours together roaming to different insurance companies, calling them over and over again just to compare a few quotes from two or more of them. Online insurance shopping has made it very much convenient for the shoppers to sit in the comfort of their homes and compare quotes from various companies to find cheap homeowners insurance. One can easily back away from all the hassle and get hundreds of quotes, both from local and national insurance companies by simply giving away a few details.
With this said, some people may not really like to give away information online to look for cheap home insurance, because some tools ask for personal credentials as well. But, one need not worry about this issue anymore, because online tools these days just ask for the shopper’s zip code and that’s it, a whole list of quotes from well-known insurance companies from over 50 States will appear on the screen. This method of online shopping to search for cheap home insurance quotes is easy, quick and above all it is free.
Getting the best and cheap home insurance is something that every online shopper looks for. But in search for cheaper home insurance quotes, one should not miss the actual benefit of having homeowners insurance. A full coverage home insurance is a protection for one’s home and the property within it. Hence, comparing insurance quotes simply based on their cheap rates is not worth it. One should be clever enough to identify affordable quotes that provide complete benefits of having a home insurance rather than just opting for some cheap homeowners insurance quotes that are not really worthy.
But one need not think that in order to avail a full coverage home insurance, one will have to pay too much of premiums. It is definitely possible to enjoy low cost homeowners insurance and at the same time get a decent coverage plan. In order to choose cheap homeowner insurance quotes, one must first be aware of what are the different types of coverage plans available and then finally decide on one that suits their needs the best.
What is Covered Under a Homeowners Insurance Policy?
According to Insurance Information Institute (III), homeowners insurance is divided into different categories, which are denoted as HO-1, HO-2, HO-3, HO-4, and so on until HO-8. Of all these policies the first type, i.e. HO-1 is no longer available as it provides very basic coverage scheme. The other policies are discussed below:
HO-2 and HO-3: These two policies are the most prevalent ones. The HO-2 policy is also known as ‘broad-form policy’ and HO-3 as ‘special-form policy’. People having these types of coverage can claim for money in any of the following 16 situations:
1. Damage caused due to current shocks generated artificially.
2. Unexpected damage caused due to aircraft
3. Vehicle rampages that damage the house
4. Damage due to falling objects
5. Damage to the house due to heavy snowfall, ice or due to the weight of sleet
6. Lightning or fire blasts
7. Damage due to Volcanoes
8. Windstorm damages
9. Unpredictable blasts
10. Damage caused due to excessive smoke
11. Malicious mischief
12. Loss of possessions due to stealth/theft
13. Damage to the house or other possessions due to riots or rallies
14. Accidental damage such as cracks or swollen appearance of appliances such as air conditioners, water heaters, and fire-protectors.
15. Damage caused to home appliances due to extreme cold weathers resulting in their freezing.
16. Damages due to steam or water leakage from water heaters, air conditioners, fire-protectors or other appliances.
While both HO-2 and HO-3 provide coverage for damages caused due to above 16 issues, but there is a small difference that makes one more advantageous over the other. The HO-2 policy does not provide coverage for damages apart from the above list. Whereas, the HO-3 policy not only covers the above-listed damages, but will also provide coverage for any other type of damage as well, except a few natural disasters such as earthquakes, floods, and other severe issues such as nuclear disasters, wars, and pests.
HO-5: This policy is similar to HO-3, but with an extension that it provides coverage for one’s possessions in the house as well.
HO-4: This policy is special in the fact that it provides coverage for renters.
HO-6: Coverage for condo owners can be availed by opting for this policy.
HO-7: If one is in search of cheap mobile home insurance, then the HO-7 policy is the right choice.
HO-8: If the house one lives in is an old construction, then choosing HO-8 policy will help them to avail cheap home insurance.
What damages are not covered?
The following are the damages that are not covered by any type of home insurance and require separate policies for protection:
â Sewage damages
â Damages due to negligence
â Damages due to pests
How to Calculate Home Insurance?
Another important element to finding affordable homeowners insurance is to know how much insurance one would actually need. This estimation will help the homeowner to have an idea of the cost for damages or loss of possession; he/she can face in case of any calamity and then appropriately judge the amount of home insurance one should avail. Here are the basic steps using which one can estimate one’s home insurance:
â The first step in order to calculate one’s homeowners insurance is to estimate the total cost of rebuilding one’s home after heavy damage. This calculation should be done by considering all the costs at the rates one has built the home.
â Secondly, one should estimate the total cost of all the possessions that one might think would be damaged in case of any disasters. Experts suggest that the cost of possessions or property should generally amount up to 50-75% of the rebuilding cost of one’s home. For instance, if one estimates the rebuilding cost as $250,000, then the cost for possessions should be estimated as $125,000. Also, expensive jewelry or artifacts will require additional coverage.
â The next step is to calculate the liability coverage, i.e. the amount one would be liable to pay if someone gets injured on the homeowner’s property. This amount could range between $100,000 and $500,000.
â The final step is to estimate the extra charges one might face. This includes damage due to natural disasters that are not covered by home insurance policies.
Hence, a careful examination and estimation of all the points discussed above can help one to get the best and cheap home insurance possible, while enjoying the maximum benefits.